Little cloud uptake yet, according to Australian CIOs

Tuesday, April 16, 2013

Information technology is still predominantly conducted outside of the cloud in Australia, according to research by the global analyst firm Ovum.
A recent survey of 63 chief information officers in Australia found that three-quarters of IT activities were provided by in-house IT departments.
“It is always difficult to assess the true rate of cloud services adoption – and to sift fact from fantasy,” said Steve Hodgkinson, research director for Ovum’s Asia-Pacific IT research. “This survey… provides a good qualitative assessment of their views on current and target sourcing approaches across a spectrum of 50 (IT) activities. These spanned the categories of data center, network, application development, information management, applications and end-user services. The results reveal a rather prosaic focus on traditional in-house IT operations.”
Ovum does note the figure is projected to decline to 61 percent over the next one to two years. Shared services arrangements account for around 9 percent of IT activities, while outsourced arrangements currently account for 13 percent of IT activities. The latter figure is projected to rise to 20 percent over the next two years across a range of services – primarily focused on data center, network, and application development services.
Around 4 percent of IT activities are currently sourced as cloud services – primarily software-as-a-service (SaaS) applications – but overall this proportion is projected to rise significantly during the next few years. Cloud sourcing of data center and application services, in particular, is expected to comprise more than 15 percent of the ICT mix.
“The reality for this group of CIOs is that (IT) management is still about managing the people, processes, and technologies of the in-house (IT) department,” Hodgkinson said. “It is therefore not surprising that a shortage of people and skills was regarded by CIOs as one of their major challenges. However, outsourcing and cloud services are projected to account for one-third of ICT activities overall in the next one to two years. Change is definitely coming, while perhaps more slowly than expected, and momentum for cloud services in particular is expected to build during the next few years.” - Eric Johnson